IPO Watch Asia US$243bn IPO and FO proceeds raised in 2014 US$630bn proceeds raised from 2012 to 2014

Transcription

1 IPO Watch Asia 2014 US$243bn IPO and FO proceeds raised in 2014 US$630bn proceeds raised from 2012 to IPOs Companies listed in ,494 IPOs from 2012 to ,710 FOs Further offers in ,856 further offers from 2012 to

2 About IPO Watch Asia IPO Watch Asia provides an overview of all new primary market equity IPOs and FOs in which capital was raised on Asia s principal stock markets (including exchanges in Greater China, Singapore, Australia and New Zealand, Vietnam, Korea, Thailand, Indonesia, Japan, Malaysia and the Philippines). The analysis covers companies which were listed on these markets up to 31 December For comparability purposes, all figures in this report have been translated into United States Dollars (USD) at the applicable closing exchange rate at the end of each year. All market data is sourced from Dealogic and the stock markets themselves unless otherwise stated and has not been independently verified by PwC. This report has been prepared by the China/Hong Kong Capital Market Services practice of PricewaterhouseCoopers. 2 IPO Watch Asia 2014

3 Contents Forward Summary of key findings 1. Proceeds of Asian IPOs and FOs Asian IPO data by exchange 3. Asian FO data by exchange 4. Top 10 IPOs by proceeds in 2014 and Analysis by sector PwC 3

4 Foreword Welcome to the Asia IPO Watch 2014, PwC s publication exploring equity market trends across the Asia-Pacific region. Reflecting the integrated nature of capital markets, we have broadened our discussion beyond initial public offerings (IPOs) to include the equity follow-on market, or further offers (FOs). Our goal is to provide insights relevant to potential investors or those businesses undertaking an IPO or FO transaction in the near future. Our publication analyses equity capital market (ECM) transactions that occurred during on exchanges throughout Asia. In the global arena, we believethat Asia is poised to continue its significant contribution to global ECM activity in We hope you find the insights of our analysis of Asian equity capital markets to be both interesting and useful. Kennedy Liu Head of China/HongKong Capital Market Services PwC 4 IPO Watch Asia 2014

5 Summary of key findings Overview of the IPO markets in Asia It has been a buoyant year for IPOs in Asia. IPO activity in Asia stood at US$82.5bn raised via 583 IPOs in 2014, compared to US$58.4bn via 429 IPOs in During 2014, Asia accounted for 24% of the total amount of money raised and 40% of the number of deals. The IPO of Medibank Private (raising US$4.9bn on ASX) was the largest Asian IPO of Strong activity on HKEx during 2014 resulted in the 2nd and 3rd largest Asian IPOs of 2014: Dalian Wanda Commercial Properties and China s biggest atomic energy producer CNG Power raising US$3.7bn and US$3.6bn, respectively. The top five IPOs in Asia is complemented by the listings of Hong Kong electric utility HK Electric Investments (raising US$3.1bn on HKEx in January), smartphone and tablet screen maker Japan Display (raising US$3.1bn on Tokyo Stock Exchange in March) and pork producer WH Group (raising US$2.4bn on HKEx in July). Robust IPO activity in Greater China continued to make strong contribution to Asian IPO activity in The number of IPOs in Greater China increased from 144 in 2013 to 268 in The amount of funds raised from IPOs increased by 92% from US$22.6bn in 2013 to US$43.4bn in This increase in IPO volumes and funds raised was primarily due to the resumption of new listings on the Mainland stock exchanges and an increase in IPO volumes in Hong Kong. Australia and New Zealand experienced a 28% increase in IPO volumes compared to 2013 together with a 62% increase in funds raised. Australia and New Zealand saw 86 IPOs in 2014 raising US$16.2bn, including the third largest IPO globally as Medibank Private raised US$4.9bn on ASX. In 2013, only 67 IPOs were executed raising a total of US$10bn. The increase in funds raised was driven by the privatisation of Medibank Private which raised US$4.9bn and was Australia s biggest IPO for nearly 20 years. Natural resource IPOs continued to be relatively weak reflecting commodity prices dropping to only around 10% of all IPO activity. The remaining IPOs came from a diverse range of industries including real estate, financial services, healthcare and consumer services. The number of IPOs in Japan increased from 60 in 2013 to 83 in 2014, exceeding levels experienced prior to the financial crisis. The IPO funds raised in Japan increased marginally from US$10.2bn in 2013 to US$11.5bn in The IPO of Japan Airlines in 2012 raised US$8.5bn alone whereas the largest IPO in Japan in 2014 was the US$3.2bn raised by Japan Display. The number of IPOs in Singapore (including Main Board and Catalist) increased from 25 in 2013 to 27 in IPO funds raised decreased from US$4.9bn in 2013 to US$2.6bn in The Korea Stock Exchange continued to attract IPOs in Total money raised in 2014 in Korea stood at US$4bn via 39 IPOs (2013: US$1.2bn via 36 IPOs). The successful IPO of Cheil Industries, Samsung Group s de facto holding company (raising US$1.4bn on KRX), became the largest Korean IPO of the year. Due to unfavourable market conditions brought about by Thailand s political troubles, Thailand s IPO activities have slowed in 2014, with the funds raised slashing by half from US$5.2bn in 2013 to US$2.6bn in 2014 despite the transaction volume remained stable at 41 IPOs in The months-long political unrest has delayed fundraising deals, given that some companies in the pipeline are opting to hold off until Thailand s political situation has improved. Meanwhile in Indonesia, 2014 was a year marked by legislative and presidential elections. Indonesia saw both a 40% decline in the IPO number and 60% decline in funds raised, which stood at 19 IPOs and US$0.7bn funds raised respectively in 2014 amid political and global uncertainty. Many companies have tentatively scheduled their public offerings for after the election. Furthermore, global sentiments are also not conducive in 2014 as the global economic recovery can be labelled sluggish and the US Federal Reserve s monetary tightening leads to capital outflows from emerging markets. Malaysia continued its development as a capital market but, as a result of a number of delayed IPOs, recorded a decrease in IPO funds raised from US$2.6bn in 2013 to US$1.3bn in The number of IPOs fell from 17 to 15. IPO activity in the Philippines remained stable with funds raised improving from US$0.2bn in 2013 to US$0.3bn in PwC 5

6 Market outlook As economic recovery continues in many markets and easing monetary conditions are in place to drive investor confidence, it is expected that IPO activity will maintain its strong momentum in In particular, confidence has been bolstered by favourable government policy in Greater China following the implementation of the long-awaited Shanghai-Hong Kong Stock Connect. With a solid pipeline of IPO-ready businesses across a broad range of markets in Asia-Pacific and from multiple sectors, a significant uptick of IPOs is expected in 2015 from the financial, real estate, health care, technology and consumer products and services sectors. 6 IPO Watch Asia 2014

7 1. Proceeds of Asian IPOs and FOs Overall ECM Activity, , , , , ,293 2,200 2,103 2,000 1, , , ,400 1, ,000 FO Money raised (US$bn) IPO Money raised (US$bn) Number of IPOs+FOs Over the past three years there have been 6,350 ECM transactions raising US$630bn. Over this period money raised by companies on the exchanges in Greater China, Australia and New Zealand, and Japan represented 83% of capital raised and 81% of transaction volume. In 2014, money raised by companies on other Asian exchanges decreased to US$36bn by 4% albeit the transaction volume increased by 3%. During 2014, ECM activity overall increased by 9% in terms of volume of transactions and 21% in terms of capital raised to US$243bn from US$202bn in Source: HK/China from Capital Market Statistics Report prepared by HK/China Other regions based on Dealogic Asian IPOs, IPOs Money raised (US$bn) Number of IPOs Over the past three years there have been 1,494 IPOs raising US$201bn. Over this period, Money raised from IPOs by companies on the exchanges in Greater China, Australia and New Zealand, and Japan represented 78% of capital raised and 70% of transaction volume; and Average proceeds raised per IPO were US$135m (US$150m on the exchanges in Greater China, Australia and New Zealand, and Japan and US$99m on other Asian exchanges). In 2014, funds raised in IPOs by companies on the exchanges in Greater China, Australia and New Zealand, and Japan increased by 66% to US$71bn from US$43bn in 2013, which is in line with the increase in transaction volume by 61% to 437 IPOs from 271 IPOs in In 2014, money raised by companies on other Asian exchanges decreased to US$11bn by 26% from US$16bn in 2013 while the transaction volume over this period decreased by 8%. During 2014, IPO activity overall increased from 429 IPOs to 583 IPOs by 36% in terms of volume of transactions and 41% in terms of capital raised to US$82.5bn from US$58.4bn in PwC 7

8 Asian FOs, , FO Money raised (US$bn) 1,710 1, Number of FOs 1,800 1,700 1,600 1,500 1,400 1,300 1,200 1,100 1,000 Over the past three years there have been 4,856 further offers raising US$429bn. Over this period, money raised by companies on the exchanges in Greater China, Australia and New Zealand, and Japan represented 85% of both capital raised and transaction volume. In 2014, money raised in FOs by companies on other Asian exchanges increased by 12% in terms of capital raised and 10% in terms of transaction volume. Overall, FO activity during 2014 increased to US$160.5bn from US$143.1bn in 2013 by 12% in terms of capital raised and increased by 2% in terms of volume of transactions. 2. Asian IPO data by exchange Number of Money raised Number of Money raised Number of Money raised IPOs (US$bn) IPOs (US$bn) IPOs (US$bn) Hong Kong Shanghai Shenzhen Taiwan Singapore Australia & New Zealand Vietnam Korea Thailand Indonesia Japan Malaysia Philippines Total Total Number of Money raised IPOs (US$bn) , Asian FO data by exchange Number of Money raised Number of Money raised Number of Money raised IPOs (US$bn) IPOs (US$bn) IPOs (US$bn) Hong Kong Shanghai Shenzhen Taiwan Singapore Australia & New Zealand Vietnam Korea Thailand Indonesia Japan Malaysia Philippines Total 1, , , Source: Dealogic Total Money raised IPOs (US$bn) , Number of 8 IPO Watch Asia 2014

9 4. Top 10 IPOs by proceeds in 2014 and 2013 Top 10 IPOs 2014 Company Name Money raised (US$m) Sector Country of operation Stock Exchange Medibank Private Ltd 4,923 Insurance Australia Australia Dalian Wanda Commercial Properties Co Ltd 3,715 Real Estate/Property China Hong Kong CGN Power Co Ltd 3,638 Utility & Energy China Hong Kong HK Electric Investments / HK Electric Investments Ltd 3,111 Utility & Energy China Hong Kong Japan Display Inc 3,085 Computers & Electronics WH Group Ltd 2,362 Food & Beverage China Hong Kong Healthscope Ltd 2,117 Healthcare Australia Australia Recruit Holdings Co Ltd 1,968 Computers & Electronics BAIC Motor Corp Ltd 1,422 Auto/Truck China Hong Kong Cheil Industries Inc 1,368 Real Estate/Property South Korea South Korea Tokyo Japan Tokyo Tokyo Top 10 IPOs 2013 Company Name Money raised (US$m) Sector Country of operation Stock Exchange Suntory Beverage & Food Ltd 3,965 Food & Beverage Japan Tokyo China Cinda Asset Management Co Ltd 2,824 Finance China Hong Kong Sinopec Engineering (Group) Co Ltd 1,797 Construction/Building China Hong Kong Nomura Real Estate Master Fund Inc 1,656 Real Estate/Property Japan Tokyo Meridian Energy Ltd 1,596 Utility & Energy Australia Australia China Huishan Dairy Holdings Co Ltd 1,500 Food & Beverage China Hong Kong Mighty River Power Ltd 1,431 Utility & Energy New Zealand New Zealand BTS Rail Mass Transit Growth Infrastructure Fund 1,418 Transportation Thailand Thailand Huishang Bank Corp Ltd 1,368 Finance China Hong Kong Mapletree Greater China Commercial Trust 1,264 Real Estate/Property Singapore Singapore PwC 9

10 5. Analysis by sector IPOs breakdown by sector (by number of IPOs) 6% 3% 2% 15% Financial services 6% 2% 3% 1% 13% 7% Industrial products & services 13% 21% % 13% 8% Consumer goods Consumer services Basic materials Technology Healthcare Oil & gas Utilities Telecommunications 23% 4% % 15% 12% FOs breakdown by sector (by number of IPOs) 6% 2% 2% 2% 15% Financial services Industrial products & services 7% 4% 3% 2% 15% 16% % Consumer goods Consumer services Basic materials Technology Healthcare 16% % 7% Oil & gas Utilities 7% 20% 10% Telecommunications 19% 12% 10 IPO Watch Asia 2014

11 Capital Market Services practice The Capital Market Services practice is part of the Assurance practice of PricewaterhouseCoopers. It is comprised of a core team of specialists who provide a broad range of services to companies and/or investment banks in connection with all aspects of capital market transactions. These include preparation for becoming a public listed company, selecting the right market and advisory team, advising on group restructuring, accounting and regulatory issues, and acting as reporting accountants. The China/Hong Kong Capital Market Services practice is part of the PricewaterhouseCoopers global network of capital markets specialists. China/Hong Kong Capital Market Services Practice partners and directors Kennedy Liu kennedy.liu@hk.pwc.com Edmond Chan edmond.chan@hk.pwc.com Rayon Chu rayon.wh.chu@hk.pwc.com Pauline Leung pauline.pw.leung@hk.pwc.com Xuemei Li +86(10) xuemei.li@cn.pwc.com Rock Liu +86(10) rock.liu@cn.pwc.com Thomas Lo thomas.lo@hk.pwc.com Eddie Wong eddie.kc.wong@hk.pwc.com Doris Tu +86(10) doris.tu@cn.pwc.com Laura Butler +86(10) laura.butler@cn.pwc.com Rita Chan rita.chan@hk.pwc.com Geoffrey Tang geoffrey.tang@hk.pwc.com About PwC For more information visit: PwC helps organisations and individuals create the value they are looking for. We are a network of firms in 157 countries with more than 195,000 people who are committed to delivering quality in assurance, tax and advisory services. Find out more and tell us what matters to you by visiting us at PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see for further details. PwC China, Hong Kong, Macau, Taiwan and Singapore work together on a collaborative basis, subject to local applicable laws. Collectively, we have around 730 partners and a strength of around 17,000 people. Providing organisations with the professional service they need, wherever they may be located. Our highly qualified, experienced professionals listen to different points of view to help organisations solve their business issues and identify and maximise the opportunities they seek. Our industry specialisation allows us to help co-create solutions with our clients for their sector of interest. We are located in these cities: Beijing, Shanghai, Tianjin, Chongqing, Shenyang, Dalian, Xi an, Chengdu, Qingdao, Nanjing, Suzhou, Wuhan, Hangzhou, Ningbo, Xiamen, Guangzhou, Shenzhen, Hong Kong, Taipei, Chungli, Hsinchu, Kaohsiung, Taichung, Tainan, Macau and Singapore. PwC 11

12 About Asia IPO Watch Asia IPO Watch surveys all new listings and further offers on Asia Pacific s principal stock markets and market segments. All of the graphs, tables, and data used within this publication have been collated or extracted by the Capital Market Services practice research team. In collating and extracting this information, we rely upon data sourced from Dealogic and provided directly by various exchanges. We do not carry out any confirmation procedures on that information. How can PwC help? Going public is a major challenge for any company and there are many decisions that will need to be taken prior to an IPO. Management will need to steer the company through a complicated and often time-consuming process in order to be ready for an IPO. Planning and good preparation are crucial for a successful flotation. It s not simply a question of appointing advisors but about ensuring that the company is ready to be listed on the public markets and that it is able to meet the challenges that such a listing brings. If you are planning on listing, there will be many questions you will want to ask. These are just some of the questions we will be able to help you find answers to: What is an appropriate valuation for my business? What does being a public company really mean? How long will it take to complete an IPO? Do we have the right resources? Are my people ready? How to implement a stock based compensation plan? Do we have an attractive story for potential investors? What is the best way to articulate our strategy? What are the corporate governance issues we need to address? What are the internal control procedures we need to implement? How many non-affiliated/independence directors should we have on the board? What are the implications of a concurrent offering of shares to sophisticated investors in the US (via144a) or elsewhere (via Reg S)? How do our accounting policies compare with other companies in the sector? Is my finance function ready? Are my operations run and managed effectively? What additional disclosures will we need to provide as a public company? Will it be a problem if one of our subsidiaries has a modified audit opinion? Do we need to restate our track record for recent acquisitions and disposals? How will an IPO affect our existing incentive arrangements? Any other possible listing venues? 12 IPO Watch Asia 2014

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